The following is a narrative of internal control of the Purchasing process.

1. Draw a flowchart from this narrative,
2. In your auditor’s opinion, does this internal control effective?

XYZ Company has the following internal control over their purchasing process:

1. Purchase Order Request Form
   1. For Production items (items of COGS):
      1. Shift supervisor enter the request into the ERP system.
      2. Floor manager check the request items against existing inventories, if approves then release the purchase request in the ERP system.
   2. For Non-trade related items (such as: office supplies, computer supplies, etc.)
      1. Office personnel send the request to Department head
      2. If Department head approves, the request will be entered into the ERP system as Non-COGS items.
      3. Office manager check the request items against existing inventories, if approves then release the request in the ERP system

Answer rating: 100% (QA)

A Flow chart of the Purchase process B Whether the Internal control is effective The reques... View the full answer